Japanese bond yields are climbing (prices falling) as investors start to question whether Japan is ever going to get to grips with what is the worlds biggest government debt pile relative to GDP at over 250% (italy is just over 100 for comparison).
For 20 years Japanese central bank rates have effectively ben 0%, dragging down the yields on Japanese Government bonds to typically between 1 and 1.50% depending on maturity. Now however they're climbing sharply as investors extrapolate the european disaster to other economies.
I recall hearing or reading somewhere a year or so ago that if Japanese Government bond yields go to 4%, then 100% of government revenues will go on servicing the existing debt stock.
Of course there is one other country out there too with large debt stock, a large budget deficit and no apparent plans to do anything about either....
10yr Japan Govt Bond yields
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